No. This is the most common mistake. To defer 100% of the taxes, you must reinvest the entire net sales price. If you sell for $1M, you must buy for $1M or more. If you only reinvest your $400k profit, the other $600k (used to pay off your old mortgage) is considered "boot" and is taxable.

Yes. If you had a $500k mortgage on the old property, you can buy the new property for cash (no loan) as long as you put in an extra $500k of your own money. However, the reverse is not true: you cannot replace equity with debt (i.e., you can't pocket $100k of cash and just take out a bigger loan on the new place).